Economics

Developments in the Canadian economy have forced an important re-thinking of the respective roles of monetary and fiscal policy in supporting stable growth and job creation. But mainstream thinking about monetary policy has evolved much further than that on fiscal policy.

Before the great recession of 2008, fiscal policy had fallen greatly out of favour as a tool for macro economic stabilization. The conventional wisdom was that central banks could adjust short term interest rates to keep the economy growing more less at potential with low inflation, and indeed there was no recession from the early 1990s until the financial crisis of 2008.

Celebrated political theorist and socialist historian Ellen Meiksins Wood passed away at her Ottawa home on Thursday at the age of 73 after battling cancer. Ellen is survived by beloved second husband Ed Broadbent, founder and board chair of the Broadbent Institute, and brothers Peter Meiksins of Cleveland and Robert Meiksins of Milwaukee. She was predeceased by her first husband, Neal Wood (1922 – 2003).

The federal government has delivered on the first of its two major tax promises from the 2011 election campaign. Income-splitting has been extensively assessed and widely criticized for its revenue cost, its tilt toward higher-income families, and its failure to accomplish anything beneficial for the economy.

If the Tories go ahead with plans to double the contribution limit on tax-free savings accounts, it will cost the government billions of dollars and benefit only the very wealthy, two separate studies released Tuesday say.

OTTAWA—The existing Tax-Free Savings Account scheme is projected to cost the federal government up to $15.5 billion annually when it matures, and doubling the contribution limits would shift additional billions from tax revenues into the pockets of the already well-off, a new Broadbent Institute study has found.